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PPI – The Taxman moves in for his share of the payout!

Just as it seemed that there is after all some justice for the man on the street: and the millions of people ripped off in the PPI scandal were at last going to get their money back…the Taxman pops up!  Or should that be ‘swoops’ down like a vulture from its perch – smells rich pickings! – If you fell victim to the PPI scam then you too are facing a tax bill on your Payment Protection Insurance (PPI) claim payouts. 

A spokesman for HM Revenue & Customs told BBC Radio 4's Money Box programme: "No tax is generally due on the repayment element of compensation paid to those mis-sold PPI.  However, the additional interest is taxable - in line with other compensation claims." - "Nobody should be worse off, as had the customer not purchased PPI, but kept that money in an interest-bearing account, the interest received would have been taxable.

Those banks and lenders responsible for the scandal have set aside some £6bn to pay refunds for the mis-selling of PPI. Affected customers have been awarded compensation AND interest of 8% by the Financial Services Authority. But the interest will be subject to tax! If you have been mis sold PPI, then check with your PPI provider whether tax has been deducted at source."

HSBC, Barclays, Lloyds and the Co-operative Bank will not be deducting the tax at source. NatWest and Royal Bank of Scotland will.

Banks have been explaining to its customers that they need to contact the Taxman themselves in order to determine how much tax they are liable to.

If you are caught up in this fiasco you could be understood for thinking” Why should we have to pay anything at all?” After all, it’s the customers who were wrongly sold PPI in the first place. Funny how the Government is quick to Latch onto an extra revenue stream…it’s just a shame they weren’t as fast to move in and put a stop to these dodgy dealings earlier: saved millions of people stress and distress!

Many people were sold payment protection insurance when there was no chance they would ever be able to make a claim.  PPI policies varied from provider to provider, which just served to further complicate matters and confuse – couple this with underhand and dishonest selling techniques – and you end up with a great many people owed money, people from all walks of life. No one was exempt from this scam, all were fair game; young, old, servicemen and women, anybody!

Now that compensation is being paid to customers who have been poorly advised or mis sold PPI you should perhaps check whether you have a PPI claim for consideration, even ifs from a few years back – it won’t take long to find out. It is thought there are still many UK bank customers who have yet to step forward and make their claim.  If you are one of them, the sooner you start the ball rolling, the better.

Not all PPI complaints will lead to a bank or lender offering compensation. The bottom line is, if you’ve had a loan anytime in the last 10 years you could be entitled to PPI compensation! Here at Consumer Finance Claims we look to recover the full cost of the policy plus interest if we believe that you have been mis-sold PPI. Even if the loan is still running we can look to reduce your ongoing payments as part of our negotiations






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Congratulations! You're one step closer to receiving your compensation for mis–sold Payment Protection Insurance.


If all details look OK you will receive a Claim Pack through the post, usually within 48 hours. If there are any issues we need to discuss one of our advisors will call you.


Either way you need to return your Pack as quickly as possible to prevent any delays with your claim!